News

Legal troubles continue for Chipotle over hiring practices

April 20, 2011

Chipotle Mexican Grill is facing a criminal investigation over its hiring practices and whether the company willingly employed illegal immigrants at restaurants.

According to a story in The Wall Street Journal, the company is being investigated by the criminal division of the U.S. Attorney's office for Washington, D.C., which allegedly wrote the burrito chain April 13 seeking documents related to hiring.

From The Wall Street Journal:

It wasn't immediately clear which Chipotle restaurants the document request applied to, or how wide the inquiry is aimed, the person said. ...

Bill Miller, a spokesman for the U.S. Attorney in Washington, D.C., declined to comment on specific cases but said his office routinely works with ICE and other federal agencies.

Chipotle is now installing various new procedures for verifying employees' immigration status, Mr. Moran, the co-CEO, said. "We believe our plan will address (ICE's) concerns," he said. "We are working now to roll out those enhancements."

In March, the company fired some 100 employees at its Washington, D.C., and Virginia restaurants for lack of valid immigration records. In January, the company fired approximately 450 employees in Minnesota for lack of documentation after several audits by U.S. Immigration and Customs Enforcement (ICE). The firings led to several store protests and arrests.

The company's legal issues are being played out in the media just as Chipotle announced the designation of its 200th Restrauteur, a program designed to recognize and elevate leading restaurant managers.

Moran said the company is putting into place several new procedures designed to help validate employee documentation. In mid-February, Chipotle began to roll out E-Verify to restaurants nationwide. It is now being used at all of Chipotle's U.S. restaurants.

From 2006 to 2010, average labor costs per Chipotle restaurant rose just 1.8 percent to $444,244, while average sales at restaurants open at least one year rose 14.2 percent to $1.8 million, based on Chipotle financial filings.